LRLCF - L'Oréal: A Prestige Brand Powerhouse With Resilient Revenue Streams

2024-05-25 04:03:21 ET

Summary

• Luxury brands like L'Oréal have shown resilience during economic downturns, leading to better stock performance post-recession.
• L'Oréal has successfully weathered financial crises and posted all-time revenue records, although its stock price did suffer during the prior crisis.
• L'Oréal's business model, which includes acquiring early-stage brands and leveraging social media, has contributed to its long-term revenue growth and healthy financials.

I've been dwelling on luxury and prestige brands. The main thesis is that luxury brands are great to have during negative economic events due to the persistence of the revenue streams, which are usually capable of weathering recessions with small revenue losses and quick recoveries, which translates into better stock performance in the aftermath of recessions. I have made this case for Louis Vuitton ( OTCPK:LVMUY ) and will now test it for L'Oréal ( OTCPK:LRLCY )....

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